Life Insurance Mistakes to Avoid

As you embark on the life insurance process, avoid these mistakes.

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Buying life insurance – or increasing the amount you already have – is almost always a sound financial decision. By making a small payment to an insurance company, you can ensure that your loved ones are protected in your absence.

Most financial advisors recommend life insurance regardless of your age or health. And many employers provide it along with traditional medical and dental benefits. They even allow discounted rates for additional coverage if you need to pursue it.

While The types of life insurance are expansive and can be tailored to your individual needs and circumstances, it may seem like a relatively easy personal financial decision to make. If you are currently in the market for life insurance or simply want to increase the coverage you already have, now is a good time to do so. You can get started by getting a quote today.

3 Life Insurance Mistakes to Avoid

When embarking on the life insurance process, however, avoid these common mistakes:

  1. Underestimating the required coverage
  2. Not comparison shopping
  3. Buying it later in life

Underestimating the required coverage

How much life insurance do you need? is specific to your individual circumstances, personal financial situation and preferences. There is no clear number that applies to everyone.

That being said, life insurance provides a last resort to leave your family with financial support. Don’t count that. If you can afford it, take the higher amount. If you have a rough idea of ​​how much coverage you want, talk to a provider and get an estimate.

If you are young and single, you may not need as much insurance as you would if you were older with a family. But if you’re married, you’ll want enough to cover yourself, your spouse, and any wage loss that may occur as a result of your death. If you have kids, you’ll want to cover them, too. And if you have a mortgage – and you don’t want to leave your family without your income to pay it off – then you’ll want enough insurance to cover that.

Factor all of these considerations into your thinking when trying to determine how much coverage you will need.

Not comparison shopping

As is the case with most personal financial decisions, you’ll want to do your homework to make sure you’re making the right choice. Don’t just accept the first low offer you get. You may be able to get a higher amount of coverage for a lower premium.

You’re looking for mortgages, home and auto insurance, and even student loans. Do the same for life insurance. Different providers offer different coverage. There are tons of life insurance companies to work with, so it’s easy to find one that works for you.

Compare what’s out there only after you know exactly what you want and how much you want to pay. Do an apples-to-apples comparison to accurately gauge your bids.

For example: If you are looking for term life insurance coverage for $250,000 from one provider, make sure you are looking for the same type of insurance for the same amount from another. Otherwise, it will quickly become confusing.

Buying it later in life

Sometimes it makes sense to save and postpone purchases when you have a little more money in your pocket.

This is not the case with life insurance. The longer you wait, the older you will be and the more expensive your insurance will be. These costs will be reflected in the premiums your life insurance company wants you to pay. Every year you get older, the more expensive the new policy will become it makes sense to start as early as possible.

Even if you can’t afford the coverage you want at an earlier age, having something in place is better than nothing. Especially when you know that waiting is not profitable.

While this list is not exhaustive, it should help point you in the right direction. If you have specific questions about coverage, what you’re responsible for, and how much you can expect to pay, it’s easiest to talk to a provider. They can answer your questions and help you find a budget policy that’s right for you.

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